All Forum Posts by: Hariharan Elavarasan

If I do a rent by room strategy, do I need to furnish the bedrooms? What do you i need to furnish them with? 

I feel like if its a whole unit like in multifamily I dont have to, but I’m not sure. 

How do you advertise a rent by room? Can you on Zillow or do they only allow rentals by the unit? 

Let’s learn something today.

House hackers, what is one piece of unique advice that you have from your first experience house hacking?

I’m looking to buy in Spring/Summer so I’d love to hear different stories (good and bad) about all parts of the hack, from research to buying to managing, all of it.

I just started a W-2 job in June, I have moderate savings, and a car loan. I wanted to house hack next year summed, but is it too soon? Money isnt a huge issue, I would be going into the purchase with personal savings as well as a gift from my parents. I just started getting into real estate a couple weeks ago and I was aiming to be in it by next summer, but I dont plan on staying in the area I’m in for more than 1.5 years from now. I was looking at this first one as “im here right now and I could house hack, it may not be profitable but thats okay I got the experience of buying and landlording” 

Im noticing that some properties are efficient for rentals, but no so much for a house hack. During the analysis phase, whats a good cash flow on a MFH when house hacking? I'm aiming for properties that have a 200+ cash flow when just renting, so should I be pretty content with anywhere from 10-50 dollars when I live in one unit?

Follow up from my reply from before. I see that you said you are getting associates first then MSU for the bachelors. I studied mechanical engineering at Penn State. Graduated in December 2021. Just so you get a sense of what will likely happen if you commit to a degree, majority of engineers with 3.5+ gpas land a job in the 75k to 100k range. I was fortunate to be at the high end of that. With that(ive only been working 6 months), i am COMFORTABLY saving 1000+ a month. Let me reiterate. COMFORTABLY. But that comes with some help. My parents were able to put me through school so I have no student loans. So what do you think you can manage as a DTI? Lets say you make 39k(average associate degree salary), you have a 300 dollar car payment, a 25 dollar minimum credit card fee(dont build credit card debit, dumbest way to mess up your life). Thats a dti of 10%. Pretty good. But lets go back to your 7,500 as a down payment. First time house so lets say 3% as down. You're expecting 250k or below for a house. But your dti after mortgage would be out the park. At these rates thats like a 1600 mortgage, putting you at 60% dti, good luck on your next property. You can at most, at a 39k job, get sub 100k house. And then tough to take on more loans. With a mechE degree you double your earning potential(granted you may have loans, but instead of saying I can't go to school, think about how you can manage school and minimize the debt you get)

Even if you get no aid(FAFSA), scholarships, etc, id still suggest working a part time job and cutting costs anywhere ya can, get through school and come out with that overpriced but important piece of paper. More networking opportunities through college. Ive got a stash of rich engineers that I can turn to for future private lending, a network across the country. 

If you can pay to get through school, in this world, you kinda have to. But notice how I’m not saying dont pursuit real estate. My engineering job is just an ends to my means. My means being sipping margs on a beach while I make money. 

Good luck, so many great viewpoints on this thread, definitely take it in, but also dont let that part of your life be dictated by the feed. Thats not a solid mindset. The posts saying “yeah you got this, dont go to college” wont be liable when you are barely living paycheck to paycheck, and all the posts saying go to school do not want to see you in that position.

How does one vet a lender? Ive spoken with two lenders. One was local and one was zillow home loans. Its obvious these guys have some advantage to sell their business. So what is to look out for? I have some thoughts but I’d love to hear more

Local vs Zillow - how important is this? Im also leaving the area in 2 years so would it be better to build a relationship with an on the ground lender, or an online lender that I can utilize for property anywhere?

Enthusiasm - both were pushing that they were creative at finding the best way to play the loan approval game. Zillow guy did have more ideas during the meeting though.

Costs- do lenders tell you up fron their origination fee and points if you ask? Can you just ask what their par rate is?

Hi Blake,

While I respect the hustle spirit within you  to think of quitting college, i would really analyze what is the best option. A degree is valuable here and it is a fall back that you are setting up for yourself. Lenders like to see a steady flow of income which allows you to qualify for better deals. Even with that it can be hard. I started speaking to some lenders and I have no loans other than a sub 1.4k no interest credit card debt, and a car loan. I am grateful for no student debt but without my salary I would not qualify. If you can find good income from something other than a degree job then sure but really think this out. Can you afford to lose your degree progress? Will not having as much student debt translate to proper financial success? What is the cost of your regret in 5 years if you realize you need to finish your degree? Going back to school can be hard. 

Good luck! 

I know that every deal is different and that the answer is “it depends” but whats a realistic level of funds to have before committing to the process? The plan is to buy a single family home and focus on cash flow. I want to enter but not jump into the whole mess of mass renovation right now. Could i get a sense of what different funds are appropriate?

ex: if you have 20,000, you can go for a 100k and below property, accounting for offer, closing, fees for inspections, reserves for safety, and some for minor renovation 

Or if you have 40,000, you can go for sub 200k

I believe with my income, current cash (checking, savings, brokerage, retirement), and credit score i could qualify for 250-300k home.

After doing some calculations, I’m noticing that I have to really lowball the offer for potential BRRRRS in my area. Am I right in saying, “dont worry about how low your offer is, if doesn't hurt to see if they’ll take it” 

For example a property near me is listed for 59,900 but its been there for 140 days. I havent seen it, but based off of some reading I want to say itll cost 20-25k to fix it up. My ARV however, since the local area isn't amazing, would be 75-85k. At this ARV, I wont reap the benefits without offering at most 27,000 dollars.

75,000*0.7 = 52,500 : 52,500 - 25,000 = 27,500 (including closing, all other expenses for contractors, inspections, aka everything) 

I almost feel like I should ask it for 20,000 and go into the repair with 32,500 instead. Is this unrealistic? Doesn't hurt to ask right?

If the local area wouldn't really make sense to do a BRRRR, is it better to buy a property, fix it up just a little and then start renting? Single family or multifamily

I‘m estimating about 20,000 for 1400 sq ft MFH, but if the houses in the area aren't also fixed up and selling for a good ARV, then should I focus on a different strategy for my first purchase?

What has worked for people that at least gets them equity? I’m fully prepared to not be disappointed when i see a a small cash flow for my first couple purchases.